Not upheld

The ASA noted that Wonga believed the ad went no further than to describe the product in broad terms. We considered that the predominant message viewers would take from the ad was that they could obtain a loan extremely quickly by visiting the Wonga website. We considered that the claims "We make decisions instantly", "Money could be in your account in 15 minutes" and "We're fast here" made the 'speed' point explicitly and we considered that the visual message, while clearly intended to be light-hearted, reinforced that message by showing one of the characters typing rapidly and reacting quickly to catch the falling mug. We noted that the ad started and finished with a reference to "Wonga.com" and that during the ad one of the characters stated that the process was "all done online", before another gave an opinion on the potential inconvenience of applying for credit by telephone. We considered that those statements and the on-screen text that read "T&Cs apply" made clear to viewers that they would have to visit the Wonga website for more information and to apply for credit.

We noted that the website to which viewers were directed also carried prominent references to the speed with which a loan could be obtained. However, although we noted that the APR was high (listed on the Wonga website at the time of the advertising as 4,214%), as was the actual interest rate, we noted that this information was provided clearly on the website, which also included a mechanism that allowed consumers to calculate the true cost of borrowing. We noted that the customer satisfaction survey only included the views of those who had chosen to use Wonga's services having visited the website and related to the period before the ad was broadcast, but we noted that the vast majority of participants had agreed that information was communicated well when using Wonga's service.

We considered first whether the APR should have been quoted by virtue of regulation 6(1)(b) of the CCARs, which said an ad must state the representative APR if it included an incentive to apply for credit. The Term "incentive" was not defined. Guidance from the Office of Fair Trading ("the OFT") on the predecessor legislation said that references to the speed at which loans could be obtained might be an incentive that triggered the requirement for the inclusion of a representative APR. However, the OFT also drew our attention to the recent decision of the First-tier Tribunal (Consumer Credit) in Log Book Loans v OFT in which the Tribunal had concluded that, whilst "incentive" was likely to cover the offer of a special gift or holiday or stated discount, ads which referred for example to "fast loans" as part of a general description of the basic product offered did not constitute an incentive to apply for credit. Although the decision of the Tribunal was not binding on us, we thought it helpful and noted that the OFT was still considering its position (with regards to the extent that references to 'speed' might constitute an 'incentive' for the purposes of the CCARs) in light of the Tribunal decision. We concluded that the various statements relating to speed throughout the ad constituted a description of the inherent features of the service on offer rather than an incentive to apply for credit within the meaning of regulation 6(1)(b) of the CCARs (such as might be the case with, say, some categories of case being dealt with more speedily).

We then considered whether the ad was misleading by omission in failing to state a representative APR, given the high rate of interest charged and potential vulnerability of those seeking a rapid short-term loan. We considered that the emphasis on speed in the ad could encourage some viewers to spend little or no time considering the possible alternative sources of funding. We noted that the "Review of high cost credit" produced by the OFT in 2010 included survey evidence suggesting that speed was indeed an important factor for those seeking short-term high cost credit. However, the same evidence also suggested that some 80% of payday borrowers had other credit options available (even if they might not consider them) and would ordinarily be in employment and not among the most vulnerable sections of society. We noted that the representative APR, which the CCARs required to be quoted in certain circumstances, was not necessarily a helpful indication of the cost of short-term credit products. The ad did not include specific information on the terms upon which credit was available and instead directed viewers to the website where all information regarding the cost of borrowing was clearly presented. Although we considered it would be desirable for ads for short-term high cost credit products to alert viewers clearly to what was on offer (e.g. by stating "X is a high interest, short-term loan provider"), we concluded that the ad was unlikely to mislead viewers by omission of material information concerning the rate of interest.

We investigated the ad under BCAP Code rules 3.2 (Misleading advertising) and 14.11 (Financial products), but did not find it in breach.